CHICAGO, Nov. 4, 2013 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the Wells Fargo & Company (NYSE:WFC-Free Report), Apollo Group Inc. (Nasdaq:APOL-Free Report), Comcast Corporation (Nasdaq:CMCSK-Free Report), New Oriental Education & Technology Group Inc. (NYSE:EDU-Free Report) and Xueda Education Group (NYSE:XUE-Free Report).
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Here are highlights from Friday's Analyst Blog:
Wells Fargo Settles with FHFA
Wells Fargo & Company (NYSE:WFC-Free Report) announced a settlement with the Federal Housing Finance Agency (FHFA) – conservator of Government Sponsored Enterprises (GSEs) Freddie Mac and Fannie Mae. The settlement is related to the sale of home loans and mortgage backed securities (MBS). Wells Fargo had to shell out a sum of less than $1 billion for the settlement.
Wells Fargo was the only major U.S. bank that was not imputed in the FHFA lawsuit. The FHFA sued 18 international institutions for selling faulty mortgages and securities to Fannie Mae and Freddie Mac. Wells Fargo managed to evade the lawsuit as its lawyers were already in negotiation with the FHFA regarding a settlement.
Notably, the penalty for Wells Fargo is considerably lower than that of its Wall Street peers, which agreed to pay $4.0 billion to FHFA.
In October, Wells Fargo announced a settlement with Freddie Mac worth about $869 million. The settlement included the resolution of all outstanding and potential repurchase claims relating to misrepresentation of loans originated and sold by Wells Fargo directly to Freddie Mac before 2009.
The lawsuit settlement by Wells Fargo reflects the bank's aim to resolve all mortgage-related issues, and thereby reduce costs over the upcoming period. Moreover, such agreements are expected to help revive the economy and hence bode well for the bank.
Wells Fargo currently carries a Zacks Rank #3 (Hold).
Apollo Gets New COO
Apollo Group Inc. (Nasdaq:APOL-Free Report) recently appointed J. Mitchell Bowling as the new chief operating officer, effective from Dec 2, 2013.
Mr. Bowling held the position of senior vice president and general manager, new businesses, at media and technology company Comcast Corporation (Nasdaq:CMCSK-Free Report) prior to joining Apollo. With his extensive experience and a record of delivering positive results, Mr. Bowling is expected to drive growth for Apollo.
In late October, Apollo reported strong fourth-quarter fiscal 2013 results, beating the Zacks Consensus Estimate for both revenues and earnings, even though enrollment continued to decline. Apollo's enrollments have been sluggish for many quarters. Enrollment trends throughout the education industry have been affected by changing regulatory requirements, sluggish demand due to students' aversion to debt, robust competition and a volatile economy.
Other Stocks to Consider
Apollo carries a Zacks Rank #3 (Hold). Overall, we are positive about Apollo Group's dominant market position and focus on offering relevant career oriented educational programs. Its accelerated efforts to right-size its business through significant layoffs and campus closings will make it more competitive in the long term. Apollo's investments in adaptive learning, curriculum development, new learning systems and student service platforms should improve student value proposition and retention rates.
Though encouraging, these initiatives are yet to show any sustainable enrollment growth. The lack of visibility on enrollment improvement and the possibility of regulatory changes keep us on the sidelines.
Better-placed stocks in the education sector include New Oriental Education & Technology Group Inc. (NYSE:EDU-Free Report) and Xueda Education Group (NYSE:XUE-Free Report). Both the companies carry a Zacks Rank #1 (Strong Buy).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
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